Thursday, August 8, 2013

Incentives matter: Bad foster parent behavior

Would receiving $17/day to help with expenses incline you towards being a foster parent, all things equal? How about if we raised the amount to $1000/day? Not hard to imagine that, under these conditions, you'd have a lot of people willing to become foster parents. What's the catch? Well, in Texas at least, foster parents can receive up to a thousand dollars a day if their foster child has mental health issues, vs. $17 if he's healthy. So, you shouldn't be surprised to learn that almost 70% of foster children are on some form of medication in Texas. Now obviously this is a group of humans who are much more likely to suffer from mental health issues than those not from broken homes. But given the strong incentives to have a child declared mentally needy, there can be no doubt that the system is rife with fraud and corruption, as this disturbing report at Hit & Run explains.